Messages - polycephalous

"If you told me three years ago that I would be working at a commercial law firm, I never would have believed it," confides "Karen," a second-year associate at a large New York firm. Karen, who requested anonymity for this article, is at the pinnacle of the legal profession: A graduate of one of the country's top law schools, she earns six figures representing corporate clients on challenging legal matters. But Karen's job represents a compromise of the dreams that led her to become a lawyer. "I entered law school with the intention of taking a public interest position in the field of human rights," she says. What changed her mind was the prospect of repaying $145,000 in student loans and $20,000 in credit card debt she accumulated during three years of law school. "I felt I had no other choice than to look for a job in the private sector," she says. "I have friends with this kind of debt who chose not to go to law firms," Karen adds. "But they either have someone providing financial support or a very different psychological relationship to this debt. Personally, I find it nerve wracking."

Karen's story is one of 400 accounts the ABA Law Student Division received when it solicited on its web site in early April "personal experiences or hardships relating to ... law school debt." On April 27 and 28, a delegation of law student officers took those stories to Washington, D.C., and visited the offices of 32 members of Congress. Their mission: to drive home the message that the high cost of law school loans is preventing a new generation of lawyers from entering public interest law. As one student account noted, "Not everyone in law school wants to make a lot of money. Some people see law as a means to getting people to listen, changing our great nation's public policy, and carving out a life we can look back on with pride." But at what personal cost, many are wondering. Take, for example, the typical legal aid lawyer, who earns a salary of $36,000, or $27,000 after taxes. If he has $100,000 in outstanding loans on a 10-year repayment plan, he will pay out $1,065 each month on student loans, leaving just $1,185 for all other expenses, notes Philip Schrag, a professor at Georgetown University Law Center and an expert in student debt issues. Schrag, along with ABA past president Robert Hirshon, current president Michael Greco, Rep. Rick Renzi (R-Ariz.), and former Law Student Division chair Chris Jeter, spoke at a program on student debt and loan forgiveness at Georgetown on April 26. The event, a kickoff to the ABA's related lobbying activities on Capitol Hill, was sponsored by the ABA Law Student Division, Young Lawyers Division, and Section of Legal Education and Admissions to the Bar.

At the heart of the problem is the rising cost of tuition, which has "risen much more dramatically than the cost of living," says Schrag, author of "Repay As You Earn: The Flawed Government Program to Help Students Have Public Service Careers." From 1992 to 2002, as the cost of living rose 28%, tuition rose 100% for in-state residents at public schools, 134% for out-of-state residents at public schools, and 76% at private schools. Law students currently graduate with an average debt load of $66,810 from public schools and $97,763 from private schools, according to Schrag. That debt is manageable on the median law firm starting salary of $90,000, but it becomes overwhelming for government and nonprofit lawyers, who draw median salaries of $42,000 and $36,000, respectively, he adds.

What are the alternatives? More than 80 law schools and eight states have started loan repayment assistance programs (LRAPs) to forgive the loans of graduates entering public interest or public service work. These programs lower interest rates on loans, defer loan payments, or forgive a percentage of loans for every year a lawyer works in a public-interest-related legal job. Their drawback, Schrag says, is that they have strict income limits: Lawyers can lose eligibility for a program after receiving a couple of salary raises. And many schools do not yet have these programs or have only a limited amount of funds to dispense. For broader relief, the ABA has been lobbying for changes in two federal loan programs: raising the annual limit on Stafford unsubsidized loans from $10,000 to $30,000 and improving the usability of the Income-Contingent Repayment (ICR) option of the William D. Ford Federal Direct Lending Program, which currently forgives federal student loans after 25 years of public service.

The Stafford program allows graduate and professional students to borrow $8,500 in subsidized loans and $10,000 in unsubsidized loans annually — an amount that Congress has not increased since 1992. Because $18,500 is insufficient to cover tuition at all but a few law schools, law students are forced to make up the difference by taking out loans from private lenders, which charge exorbitant interest rates. What makes the situation particularly unfair to proponents of law student loan reform is that the Department of Education raised the annual Stafford unsubsidized loan limit for medical and other health care students to $30,000 in 1999. The ABA argues that all graduate and professional students should receive the same treatment.

The ABA also is urging that student loans be forgiven after 15 years of public service and that the ICR program's marriage penalty be eliminated. Currently, the program limits annual loan payments to 20% of a lawyer's income, but married lawyers must pay 20% of their joint income. Whatever is unpaid each year is added to the principal. "You may actually have to pay more over time," Schrag cautions. The most significant drawback to the ICR program in its current state is its 25-year length. "Lawyers balk at paying off their student loans at the same time they are paying for their children's college education," Schrag says. The ABA House of Delegates made lobbying for these changes in the law a priority item in 2003. Two years earlier, then-ABA president Hirshon established a Commission on Loan Repayment and Forgiveness. It produced a report in 2003 titled "Lifting the Burden: Law Student Debt As a Barrier to Public Service," which included 19 recommendations to the ABA, states, and law schools.

i think your calculations are pretty good for the most part except that they ignore interest on your loan (not that high if you truly pay it off in three years, and assuming interest was deferred until graduation):

Drinker Biddle & Reath (Philadelphia)1st year: up to $115,0002d year: up to $122,5003d year: up to $132,5004th year: up to $140,0005th year: up to $152,5006th year: up to $162,5007th year: up to $172,500